HIGHLIGHTS

HIGHLIGHTS

NSSO shows technology is making inroads into villages.

Rural India spends most on mobile phones.

For most, cellphone is the only means of accessing Internet.

Rural India is spending more on cellphones and cars, indicates a new government survey that underscores aspirational consumption trends in the hinterlands.The study by the National Sample Survey Office (NSSO) shows how technology is making inroads into villages, against the backdrop of Ind

Rural India is spending more on cellphones and cars, indicates a new government survey that underscores aspirational consumption trends in the hinterlands.

The study by the National Sample Survey Office (NSSO) shows how technology is making inroads into villages, against the backdrop of India notching up its billionth mobile phone subscriber in October.RURAL POPULATION EXPENDITURE

According to NSSO data, people of rural India spend most on the use of mobile phones and telephones among all services, accounting for 25.33 per cent. This is followed by beauty services at 11.07 per cent and other services, including TV and radio services, tailoring, repair and maintenance, etc.

Rural domestic households also spend 44.71 per cent of their overall expenditure on consumer durables on vehicles.

The first-of-its-kind survey on household expenditure on services and durable goods is for the July 2014-to-June 2015 period.

In terms of Monthly Per Capita Expenditure (MPCE) also, the highest amount went to communication services - Rs 36.35 in rural and Rs 102.46 in urban areas. The rural-urban gap has closed when it comes to communication services.

While people in the villages spend about 25.33 per cent of their budget on this, urban families are marginally ahead at 26.33 per cent.

"It is also because it can be measured easily as compared with spending on other services," said Hemant Upadhyay, who advises voluntary action group Consumer Voice in IT and telecom. "People spend a lot on mobile phones, but, maximum consumption is on data due to availability of multiple services on one platform."

MOBILE PHONE USAGE GONE UP

Experts are also of the view that the use of mobile phones has gone up in all parts of the country, whether it is rural or urban, with the availability of multiple services. "It is growing as it has become a necessity for all," Upadhyay said.

"These days a mobile phone is used for various services, apart from talking. It has also become a source of entertainment for many."

For many people in the countryside, a cellphone is only means of accessing the Internet, with smartphones leapfrogging desktops as the most common way of getting online.

Upadhyay said the country is still lagging in data services, despite Prime Minister Narendra Modi's Digital India push. "Speed is the main problem. Service providers might claim that they are providing high speeds but the average speed remains around 200-250 kbps. A lot needs to be done in this direction," he added.

Rajesh Chharia, president of the Internet Service Providers Association (ISPAI), echoed the views. "It is true that the reach of mobile phones has increased in rural parts, but government's policies need to be very friendly to make the dream of Digital India a success," he said.

The NSSO survey says households allocate 23 per cent of their consumption spending on jewellery, apart from ACs, refrigerators and other cooling and electricity generation devices at 7 per cent. A similar pattern was observed in urban areas.

MAJOR EXPENDITURE ON VEHICLES

Expenditure on purchasing vehicles accounted for a lion's share of the total expenditure on durables, followed by expenses on heating, cooling and electricity generation devices (about 7.9 per cent) and IT and communication devices (7.8 per cent) for enterprises and jewellery for domestic consumption.

Speaking on the trend, Rajesh Srivastava, senior vice-president, sales and marketing, Hyundai Motors, said, "While vehicles have become necessary for families, a lot of emotional and aspirational values are also attached to them. With increasing purchasing power, people have started spending more on purchasing vehicles.

Even in rural parts, due to increase in disposable income, people want to buy vehicles." The study, "Key indicators of household expenditure on services and durable goods", covered 47,535 households in rural areas and 36,065 households in urban areas.